1. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 Management and Organisational Behaviour 7th Edition CHAPTER 5 Organisational Goals, Strategy and Responsibilities

2. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.2 Organisational goals The goals of an organisation are the reason for its existence A goal is a future expectation, some desired future state The goals of an organisation determine the nature of its inputs & outputs, the series of activities through which outputs are achieved and interactions with its external environment

3. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.3 Goal model approach Concentrates on the study of organisational goals & the measurement of success against the realisation of goals Focuses attention on an organisation’s lack of success in attaining goals at the expense of more meaningful forms of analysis

4. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.4 Defining goals As value premises which serve as inputs to decisions Goals at different levels within the organisation contribute to alternatives for decision making Goals can be see more as sets of constraints that the organisation must satisfy Simon

5. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.5 Functions of goals Goals: provide a standard of performance provide guidelines for decision-making and justification for actions taken influence the structure of the organisation and help determine the nature of technology employed

6. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.6 Functions of goals Goals: help to develop commitment of individuals and groups to organisational activities provide an indication of what the organisation is really like serve as a basis for the evaluation of change and organisational development

7. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.7 Informal & formal goals Informal goals may be inferred from the actual decisions made & actions taken within the organisation Formal goals are officially stated

8. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.8 Compatibility of organisational goals Figure 5.1

9. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.9 Classification of organisational goals Etzioni classifies organisational goals in terms of their relationship with the concept of power & compliance: Order goals – negative & attempt to place some kind of restraint upon members Economic goals – concerned with the production of goods / services to people outside the organisation Cultural goals – concerned with symbolic objects & with creating or maintaining the value systems of society

10. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.10 A systems view of organisational goals Consumer goals - the nature of outputs in terms of markets served and consumer satisfaction Product goals – the nature and characteristics of the outputs Operational goals – the series of activities involved in providing outputs and the operation and functioning of the organisation Secondary goals – those not related to the main aims of the organisation

11. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.11 Organisational values & beliefs Ethical foundation Organisational or operational foundation Brech

12. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.12 Organisational values Values are guidelines a person uses to make choices. Within organisations, basic beliefs affect what decisions are made, how people interact and the kind of work practices that are pursued and developed Values form the glue that binds an organisation’s culture Dainty & Anderson

13. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.13 An organisation’s vision & mission Vision provides the overall frame of reference within which mission statements are written & goals selected The vision is the desired future state of the organisation The mission is a general expression of the overall purpose of the organisation, which is ideally in line with the values & expectations of major stakeholders

14. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.14 A systems view of organisational goals & objectives Figure 5.2

15. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.15 Primary objectives The primary objectives of an organisation may be seen as: To continue to exist – survive To maintain growth & development To make a profit

16. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.16 Objectives of a business organisation Figure 5.3

17. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.17 Objectives – eight key areas in terms of performance & results Market standing Innovation Productivity Physical & financial resources Drucker Profitability Manager performance & development Worker performance & attitude Public responsibility

18. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.18 The balanced scorecard Combines qualitative & quantitative indicators of performance which recognise the expectations of various stakeholders & relates performance to a choice of strategy as a basis for evaluating organisational effectiveness

19. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.19 Balanced scorecard elements Financial accounting measures Product & process innovation Employee skills Customer satisfaction

20. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.20 Strategy Corporate strategy serves to describe an organisation’s sense of purpose, and plans and actions for its implementation Tilles suggests that without an explicit statement of strategy it becomes more difficult for expanding organisations to reconcile co-ordinated action with entrepreneurial effort

21. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.21 A strategic framework Bruce maintains that a business needs a structured strategic framework which provides the starting point for moving forward and a means for assessing & responding to change

22. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.22 The elements of a strategic framework Things that are driving strategic decisions The direction that the organisation is heading in The products & services that will be delivered The design of the organisation’s processes, knowledge systems & people development mechanisms Specific targets that identify whether the organisation is deviating from its plan Bruce

23. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.23 Positive synergy Positive synergy results when the whole is greater than the sum of its component parts 2 + 2 = 5 effect Example: The merger of a computer firm with expertise in the design and marketing of hardware with a firm expert in software manufacturing and systems design

24. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.24 Negative synergy 2 + 2 = 3 effect Example: When a merger occurs between organisations operating in different fields, with different markets or with different methods

25. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.25 SWOT analysis Provides convenient headings under which an organisation can study its environmental setting Provides a basis for problem solving & decision making -Strengths -Weaknesses -Opportunities -Threats

26. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.26 Managing opportunities & risks Drucker suggests that: strategy should be based on the priority of maximising opportunities risks should be viewed as limitations on actions

27. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.27 Managing opportunities & risks Selecting the right opportunities requires: A focus on maximising opportunities rather than on minimising risks Scrutinising the characteristics of major opportunities collectively rather than in isolation Understanding opportunities & risks in terms of the appropriateness of their fit to the business Striking a balance between immediate & easy opportunities for improvement Drucker

28. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.28 E-business strategies Kermally asserts that e-business strategy is important because: information can be shared more quickly and easily it facilitates human interaction it enables organisational resources and capabilities to be stretch strategically it provides global reach in marketing it allows consumers to shop 24 hours a day from any location it promotes economic growth

29. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.29 Social (corporate) responsibility of organisations The European Commission is encouraging firms to assess their performance not on profit margins alone but also on the welfare of their workforce and care for their environment

30. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.30 Organisational stakeholders Stakeholders can be considered under headings of: Employees Providers of finance Consumers Community & environment Government Other organisations & groups

31. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.31 Ethics & business Ethics is concerned with: the study of morality practices & activities that are considered to be importantly right or wrong the rules that govern activities and the values to which the activities relate

32. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.32 Ethical questions in business Behaviour towards all stakeholders The way employees are treated The effect on the natural environment Conduct in international operations

33. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.33 Ethics – further approaches Virtue ethics – based on an analysis of desirable human qualities that lie between undesirable extremes Ethical relativism – holds that goodness & badness are largely or entirely determined by the prevailing values of the day Emotivism – statements about ethics are essentially statements about the speaker’s attitudes

34. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.34 Related legislation Human Rights Act 1998 Public Interest Disclosure Act 1998 Local Government Act 2000

35. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.35 Three broad levels of enquiry Descriptive approach - draws attention to the values & beliefs of people from different cultures Normative approach - identifies sets of values & beliefs as a basis for making ethical decisions Analytical approach - attempts to explore the relationship between the normative values & beliefs and other value systems or ideologies

36. Mullins: Management and Organisational Behaviour, 7th edition © Pearson Education Limited 2005 OHT 5.36 Ethical business circles Figure 5.4